Rawls takes the basic structure of society as the subject of social justice. By basic structure, Rawls is concerned with the lasting institutional features such as the constitution, the legal system, the tax transfer system and so on. Beyond this, Rawls specifies that the justness of specific policies can only be analysed in terms of the
extent to which these policies advance the principles of justice. He argues that the outcomes of such policies cannot be considered just or unjust unless the basic structure itself was just. In this chapter, therefore, I begin my analysis of Australian housing policy with the Australian Constitution and the Australian federal system of government. Throughout this chapter, I also point to changes in the tax transfer system and the regulation of the private market and housing.
The Australian Constitution and the federal system of government
The Australian system of government is modelled on a combination of the Westminster model of ‘responsible government’ and the US federal senate system. It comprises three ‘tiers’: the federal Commonwealth government (herein referred to by either ‘federal’ or ‘Commonwealth’); six state and two territory governments (herein referred to as ‘the States’); and a number of local governments within each state and territory. A prime minister is the head of the federal government; six premiers head each of the state governments and two chief ministers, the territories. The political landscape is largely bipartisan with government held at state and federal level by the Australian Labor Party (the ‘ALP’) or the conservative Liberal Party of Australia (often in alliance with the National Party of Australia as the ‘Coalition’).
The powers of the federal government are established in the Australian Constitution.
In general terms, the Constitution provides the federal government with responsibility for matters concerning the country as a whole, while the states are responsible for matters particular to their geographic territory (Althaus, Bridgman &
Davies 2007). The States, which were separate British colonies prior to federation (and the establishment of the Constitution), have sovereign power over all areas not reserved for the Commonwealth in the Australian Constitution. The Constitution provides for the Commonwealth to provide funding to the states for whatever purpose it sees fit (Section 96), however, and should any legislation enacted by the Commonwealth conflict with State legislation the Commonwealth legislation overrides that of the State (Section 109). Local governments (or ‘Councils’) are legislatively established by the States, and are responsible for matters particular to their jurisdiction, local urban planning controls for example. In the Australian state of Victoria, 79 local councils comprise the system of local government (DPCD 2010).
There is no Australian Bill of Rights (as is implied in Justice as Fairness). As such, the fundamental political rights and liberties that are the basis of Rawls’s first principle of justice are not afforded inviolable protection in the Constitution. Rather, these are to be implied from the Constitution or found expressly in common law.
Common law does not protect the full range of rights (Harris 2004).
The Australian ‘federation settlement’
Despite the absence of a Bill of Rights and the silences within the Constitution, it is argued that an implied social contract built around a ‘federation settlement’ has underpinned the basic structure of the Australian political system. In The End of Certainty Kelly (1992) popularised the concept of the Australian federation settlement as including five pillars in: industry protection; a wage arbitration system;
the concept and policy of White Australia; alignment of foreign policy with Great Britain; and a belief in the benevolence of the state (Brett 2004; MacCallum 2009;
Stokes 2004). Kelly (1992, p.1) argues that these pillars, while not formally defined, have had a significant role in Australian political, social and cultural history:
At its inception Australia had no Bill of Rights or Declaration of Independence as a focus of national identity. The notion was not founded on war, revolution or national assertion, but by practical men striving for income, justice, employment and security. The Australian settlement was their creation. It is an achievement second only to the creation of Australian democracy, and its operation within that democracy has offered for most of this century the best definition of nationhood.
A key plank of the protection of Australian industry, which in the early 1900s consisted mainly of agricultural exports, was the imposition of tariffs on foreign imports to Australia. An arbitration system underpinned Australian protectionism and was designed to secure, for male workers, fair and reasonable wages and working conditions and the distribution of the gains of a protected economy. A landmark case in the development of the system was the ‘Harvester Judgement’ of 1907 in which a fair and reasonable wage was set according to the ‘needs of the average employee regarded as a human being in a civilised community’ (MacCallum 2009, pp.23-4).
Ultimately, this system gave rise to the establishment of national wage regulation.
The institution of arbitration, Kelly (1992, p.7) argues, was based on the ‘most
distinctive of Australian ideas’, which is the principle of a ‘fair go’. In the meantime, the role of government was to provide basic services, but never beyond a minimum required to support industry. That is, while the Commonwealth was to provide the services necessary to support its geographically dispersed workforce and to support those to whom it did not provide full employment, the focus of policy was always on getting people back to work.
Australian protectionism was also underpinned by favourable trade conditions with Great Britain. The ‘mother country’ was Australia’s greatest trading partner and provided a market for Australian exports. In return, Australia provided Great Britain with the raw materials – especially wool – that its industrial sector required, and with troops in times of war. The alliance with Great Britain was more than economic: it was also social and cultural. In place until 1966, White Australia explicitly favoured immigration to Australia from Britain, and was seen to protect Australia from a perceived threat of ‘invasion’ by its immediate neighbours (Jupp 2007). Further, at settlement, the Australian continent was considered to be terra nullius, and it was not until 1967 that Indigenous Australians were recognised in the Constitution. White Australia, the Australian government’s racially biased immigration policy, was the great eschewal of Australia’s geographic location in the Asia-Pacific region.
Kelly’s conceptualisation of the federation settlement is contested. Brett (2004, p.27) argues that it overlooks a sixth pillar: regional equality: ‘Built into the notion of what it was to be Australian was an idea of shared access to basic services, a shared minimum standard of living, no matter where you lived’, and ‘Australians’
commitment to equity and a fair go has always had a regional as well as a class dimension’. MacCallum (2009), on the other hand, argues that Kelly affords equal weight for each of the five pillars, while the central plank of the federation settlement was employment. Stokes (2004) goes further in arguing that the concept of federation settlement ought to comprise nine clusters of political ideas and policies including:
White Australia; terra nullius; state secularism; masculinism; Australian democracy;
state developmentalism; arbitration; welfare minimalism; and imperial nationalism.
Stokes (2004), as are Smyth (2004) and Sawer (2004), is still critical of the concept, however, arguing that it overlooks the contested terrain in which its component parts
are situated. That is, it presumes ‘the more or less enduring resolution of conflict’
(Stokes 2004, p.7) that created bipartisan support for certain political ideas and policies.
Despite this contestation over the settlement concept, this debate nevertheless draws attention to other, implicit and ideological dimensions of the political system beyond the Constitution. Through this chapter I want to argue that housing and in particular, the aspiration to home ownership, have been as much part of the implied social compact in the post Second World War period.
Australian federalism and the housing policy system
Australian federalism has created a unique housing policy system. As the Constitution does not prescribe a special role for the Commonwealth in housing provision (with the exception of housing specifically designated for Indigenous Australians), the Commonwealth has limited legislative capacity regarding housing, effectively leaving housing beyond the reach of its direct responsibility (Beer 1993).
As a result, while the Commonwealth is actively involved in housing policy formation, it has had to negotiate with, rather than instruct the States in these matters (Beer 1993).
Berry (1983) categorises Australian governments’ involvement in the provision of housing in three ways: as either ‘market-supporting’, ‘market-supplementing’ or
‘market-replacing’. Market-supporting policies provide the institutional foundations for housing market activity, and include legislation around property rights, contracts and land transfer, for example. Market-supplementing policies alter the relations between different groups in the [housing] market (Berry 1983). These groups or actors are free to interact in the market, typically under constrained or enabling conditions, as prescribed by particular market-supplementing policies (Berry 1983).
Examples of these policies include subsidies to private builders, building regulations, controls on rent, as well as tax subsidies, and through the provision of residential infrastructure (Berry 1983; Dalton 2010). In market-replacing policies, governments provide goods and services directly instead of having these distributed through the private market. In these policies, administrative criteria, such as a ‘need’ for housing,
replace market-based criteria, such as a willingness or ability to pay. The prime example of a market-replacing housing policy in Australia is the direct provision of housing by government, herein referred to as ‘public housing’ (Berry 1983).